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IN THE UNITED STATES DISTRICT COURTFOR THE DISTRICT OF COLUMBIA

UNITED STATES OF AMERICA,

Plaintiff,

v.

SBC Communications, Inc. and
AT&T Corp.,

Defendants.

UNITED STATES OF AMERICA,

Plaintiff,

v.

Verizon Communications Inc. and
MCI, Inc.,

Defendants.

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Civil Action No.: 1:05CV02102 (EGS)

Civil Action No.: 1:05CV02103 (EGS)

MEMORANDUM OF THE UNITED STATES IN OPPOSITIONTO COMPTEL'S MOTION FOR LEAVE TO INTERVENE,OR IN THE ALTERNATIVE TO PARTICIPATE AS AMICUS CURIAE

The United States opposes COMPTEL's Motion to intervene or to participate
as amicus curiae in these Tunney Act proceedings. COMPTEL's request
is premature, but even if it were timely, it should be denied. COMPTEL
does not meet the applicable requirements for intervention, and the
flexible procedures of the Tunney Act, 15 U.S.C. § 16(f), allow
the Court to obtain information to aid its public interest determination,
making both intervention and amicus status entirely unnecessary.

STATEMENT

1. The Tunney Act. The Court must determine that
entry of a consent judgment proposed by the United States in a government
antitrust case would be in the public interest before it can be entered.
15 U.S.C. § 16(e). The Tunney Act, which governs the Court's
public interest determination, sets forth a public comment process requiring
that the United States (1) publish notices in newspapers and the
Federal Register; (2) file a competitive impact statement
describing, among other things, the competitive harm and the proposed
consent decree; and (3) file with the Court and publish in the
Federal Register any public comments received and its response
to those comments.(1)Id. § 16(b)-(d).
The public comment process gives the Court the benefit of views other
than those of the parties prior to making its public interest determination.
The Act also enumerates factors for the Court to consider in making
that determination. Id. § 16(e)(1). If the Court
concludes that it needs additional information, the Act permits the
Court to supplement, as the Court deems appropriate, the information
provided by the complaint, proposed consent judgment, competitive impact
statement, public comments, and the government's response to comments.
Id. § 16(e)(2), (f). Courts have rarely found such
supplementation to be necessary. Nevertheless, if the Court needs additional
information, the Tunney Act places a variety of tools at its disposal
to seek that information. Id. § 16(f).

2. Proceedings to date. On October 27, 2005, the
United States filed Complaints alleging that the mergers of SBC Communications,
Inc. ("SBC") with AT&T Corporation ("AT&T") and Verizon Communications
Inc. ("Verizon") with MCI, Inc. ("MCI") violated Section 7 of the Clayton
Act, 15 U.S.C. § 18. At the same time, the United States filed
proposed Final Judgments in both matters, to which the defendants had
consented, requiring divestitures to remedy the harms alleged in the
Complaints, thus initiating proceedings under the Tunney Act, 15 U.S.C.
§ 16(b)-(h). On November 16, 2005, the United States filed
Competitive Impact Statements, see id. § 16(b), analyzing
the competitive harms alleged in the Complaints and the remedies in
the proposed Final Judgments. It filed amended proposed Final Judgments
on November 28, 2005.(2) The defendants
in both actions have filed certifications regarding certain communications
with the government, see id. § 16(g). As required,
seeid. § 16(b)-(c), the United States published
legal notices daily in The Washington Post from December 8th
to 14th, 2005 and published notices, Competitive Impact Statements,
and the amended proposed Final Judgments in the Federal Register
on December 15, 2005, inviting public comment on the proposed consent
decrees. See 70 Fed. Reg. 74,334 (2005) (SBC/AT&T); 70
Fed. Reg. 74,350 (2005) (Verizon/MCI). The 60-day public comment period
ended on February 13, 2006. The United States has received a total of
three comments, including one from COMPTEL. Our response to these comments
is currently being prepared and will be filed with the Court shortly,
along with the comments, and published in the Federal Register,
pursuant to the Act, 15 U.S.C. § 16(d). Prior to submitting
its public comment to the United States and considering the government's
response, COMPTEL filed its motion seeking leave to intervene.(3)

ARGUMENT

COMPTEL seeks to participate in this Tunney Act proceeding for the
purposes of

(1) submitting to the Court a response to the Government's
response to COMPTEL's comments; (2) participating in hearings held by
the Court (or seeking a hearing if necessary); and (3) any discovery
relevant to DOJ's relevant market definition, competitive effect in
the relevant market, and any information DOJ considered in determining
the proposed remedy.

COMPTEL Motion and Memorandum at 1 ("COMPTEL Motion"). It asks the
Court now to grant it permissive intervention for that purpose, or to
permit it to do the first two of these as amicus curiae. Id.
The Court will have ample opportunity later, after reviewing the materials
the Tunney Act provides for it to receive (including COMPTEL's extensive
comments), to consider whether it needs additional information to inform
its public interest determination and, if so, the "least complicated
and least time-consuming means possible" for acquiring that information,
H.R. Rep. No. 93-1463 (1974), as reprinted in 1974 U.S.C.C.A.N.
6535, 6539 (citing S. Rep. No. 93-298, at 6-7 (1973)). But the
Court should deny the Motion now because, whatever the Court's ultimate
need for additional information, COMPTEL does not meet the requirements
for intervention and in any event provides no reason why the Court should
grant it the status of a party in these proceedings, or even give it
the name amicus curiae, when the flexible procedures of the
Tunney Act will meet any need of the Court to obtain further information.(4)

COMPTEL Does Not Satisfy the Applicable Requirements for Intervention,
Which in Any Event Is Wholly Unnecessary.

COMPTEL Seeks Only Permissive Intervention but Does Not Satisfy
the Requirements of Rule 24.

anyone may be permitted to intervene in an action: (1) when
a statute of the United States confers a conditional right to intervene;
or (2) when an applicant's claim or defense and the main action have
a question of law or fact in common. . . . In exercising
its discretion the court shall consider whether the intervention will
unduly delay or prejudice the adjudication of the rights of the original
parties.

Fed. R. Civ. P. 24(b). In addition, any motion to intervene "shall
be accompanied by a pleading setting forth the claim or defense for
which intervention is sought." Id. 24(c). The Tunney Act
does not provide any right to intervene, 15 U.S.C. § 16(e)(2),
and COMPTEL accordingly only relies upon the second basis for permissive
intervention.

The requirements for permissive intervention reflect the purpose of
the rule, promoting the "public interest in the efficient resolution
of controversies." 7C Charles Alan Wright et al., Federal Practice
and Procedure § 1901, at 230 (2d ed. 1986). The requirement
of claims or defenses in common with the main action "appears to limit
permissive intervention to circumstances in which the putative intervenor
seeks to become involved in an action in order to litigate a legal claim
or defense on the merits," EEOC v. Nat'l Children's Ctr., 146
F.3d 1042, 1045 (D.C. Cir. 1998) (recognizing an exception for intervention
to challenge confidentiality orders), with the "apparent goal of disposing
of related controversies together," id. Absent claims or defenses
with common questions of law or fact, there is no efficiency from adding
parties. SeeMSL, 118 F.3d at 782 (noting that "litigative
economy, reduced risks of inconsistency, and increased information"
are the "hoped-for advantages" of intervention). The requirement of
Rule 24(b) that the Court consider delay and prejudice establishes that
even the benefits of simultaneously resolving related controversies
will not justify subjecting the parties of the original litigation to
prejudice or undue delay.

Not only did COMPTEL fail to file any "pleading setting forth the
claim or defense for which intervention is sought" required by Rule
24(c), cf.Diamond v. Charles, 476 U.S. 54, 76-77
(1986) (O'Connor, J., concurring) (discussing relationship between pleading
requirement of Rule 24(c) and "claim or defense" in Rule 24(b)(2)),
but, more important, it has not otherwise identified any claims that
have questions of law or fact in common with those in the main action.

"The words 'claim or defense' manifestly refer to the kinds of claims
or defenses that can be raised in courts of law as part of an actual
or impending law suit, as is confirmed by Rule 24(c)'s" pleading requirement.
Id. at 76-77 (O'Connor, J., concurring).(6)
COMPTEL's "claim" is "that the remedies proposed in the [amended proposed
Final Judgments] are grossly inadequate to remedy the anticompetitive
harms alleged in the Complaints." COMPTEL Motion at 13. That is not
a claim that could be raised in a court of law as part of a lawsuit;
it is instead an argument COMPTEL wishes to make and, in fact, has already
made in this Tunney Act proceeding in its extensive comments.(7)
Intervention as a party by COMPTEL will not increase the efficiency
of this litigation, reduce the risk of inconsistency, or dispose of
related controversies, when all COMPTEL wants to do is argue that the
relief in the amended proposed Final Judgments is insufficient.(8)
And without any enhancement to efficiency from intervention, to counterbalance
any risk of undue delay or prejudice resulting from granting COMPTEL
party status by intervention, there is no reason to grant COMPTEL's
Motion.

Even if COMPTEL Satisfies the Requirements for Intervention,
the Court Should Deny Intervention as a Matter of Discretion.

In any event, COMPTEL provides no reason why intervention should be
preferred to the other avenues of participation available under the
Tunney Act. Pursuant to the Act, interested observers such as COMPTEL
have an opportunity to make their views known to the Court via public
comments, and the Court, if it thinks appropriate, may allow them to
submit further comments, or play any number of additional roles in the
proceedings. Absent any reason that intervention would be a superior
alternative, the Court should deny it.

Courts recognize that the Tunney Act provides ample opportunities
for participation and, therefore, routinely deny intervention in Tunney
Act proceedings in district court, even while allowing participation,
such as various filings and argument, in appropriate cases without intervention.
For example, in United States v. Microsoft, the court denied
intervenor status to two entities ­ SBC and the Computer &
Communications Industry Association ("CCIA"), a trade association of
competitors and customers of Microsoft ­ but permitted them to
participate without intervenor status. Judge Kollar-Kotelly found that
allowing intervention would cause undue delay and prejudice to the parties.(9)
Similarly, in the public interest determination phase of United
States v. AT&T, see COMPTEL Motion at 6-7, 15, Judge
Greene denied all motions to intervene in the Tunney Act proceedings,
see United States v. AT&T Co., 552 F. Supp. 131, 218 (D.D.C.
1982), although he nevertheless permitted extensive participation and
granted intervention for proceedings to be held after the public
interest determination and entry of judgment, id. at 219. Judge
Greene noted that intervention was unnecessary prior to the end of the
comment period and the filing of the United States's response to comments
because all the parties seeking intervention would have "a full opportunity
to comment on the proposed settlement and that intervention is therefore
unnecessary." United States v. AT&T Co., Civ. Nos. 74-1698
& 82-0192, 1982-1 Trade Cas. ¶ 64,476, 1982 WL 1795, at
*1 (D.D.C. Jan. 21, 1982). In a subsequent denial of motions to intervene,
he noted that not only would allowing intervention "render a public
interest proceeding completely unmanageable, but the comment procedures,
together with the subsequent public interest proceedings, provide ample
protection for all legitimate interests." United States v. AT&T
Co., Civ. Nos. 74-1698 & 82-0192 & Misc. No. 82-0025 (PI),
1982-1 Trade Cas. ¶ 64,522, 1982 WL 1804, at *1 (D.D.C. Feb.
5, 1982); see also United States v. AT&T Co., Civ. Nos.
74-1698 & 82-0192 & Misc. No. 82-0025 (PI), 1982-1 Trade
Cas. ¶ 64,623, 1982 WL 1820, at *1-*2 (D.D.C. Mar. 25, 1982)
(explaining why "no purpose would be served by allowing intervention").(10)
The recent amendments to the Tunney Act have not changed the standard
for intervention in Tunney Act proceedings.(11)

After the Court has before it the normal Tunney Act materials ­
Complaints, amended proposed Final Judgments, Competitive Impact Statements,
comments, and Response to Comments ­ the United States believes
the Court will have sufficient information to conclude that the amended
proposed Final Judgments are in the public interest. If the Court, however,
believes it needs additional information,(12)
the options available to it under the Tunney Act are more than adequate
to inform the Court without intervention.

The Court Should Not Permit COMPTEL to Join as Amicus, Because
That Would Serve No Useful Purpose.

The Court does not need to grant amicus curiae status to COMPTEL to
get its views. COMPTEL has already filed comments, and if and when the
Court deems it appropriate, it can permit COMPTEL additional participation.
As a practical matter, the Court need not grant COMPTEL amicus status
because under the Tunney Act, the Court may permit COMPTEL to do all
it has requested to do as amicus without such status. Therefore, the
Court should also deny the Motion to participate as amicus curiae.

CONCLUSION

The Court does not yet have before it either the public comments,
or the United States's Response to Comments. The United States believes
that with these materials, and the others for which the Tunney Act provides,
the Court will have sufficient information to conclude that entry of
the amended proposed Final Judgments is in the public interest. However,
if after reviewing all the filed materials, the Court believes it needs
additional information, the Tunney Act gives it a variety of tools for
obtaining that information. Regardless of whether the Court ultimately
decides to hear more from COMPTEL, granting intervention provides no
benefits, but risks unnecessary complication and delay.

1. The Act also requires that defendants file
a certification describing certain communications with the United States
related to the settlement. 15 U.S.C. § 16(g).

2. The amendments added appropriate procedural
recitals regarding the Court's public interest determination to both
proposed consent decrees and corrected an error in the SBC/AT&T
proposed consent decree, conforming it to the parties' intent. The SBC/AT&T
Competitive Impact Statement reflects the correction to the proposed
consent decree.

3. Additionally, while not relevant to the Court's
consideration of COMPTEL's Motion, we note that COMPTEL incorrectly
claims that Congress in 2004 "overruled" United States v. Microsoft
Corp., 56 F.3d 1448 (D.C. Cir. 1995), or at least overruled "limiting
language" from the case. COMPTEL Motion and Memorandum at 2-3.
COMPTEL presumably refers to the congressional finding that "it would
misconstrue the meaning and Congressional intent in enacting the Tunney
Act to limit the discretion of district courts to review antitrust consent
judgments solely to determining whether entry of those consent
judgments would make a 'mockery of the judicial function.'" Pub. L.
No. 108-237, Tit. II, § 221(a)(1)(B), 118 Stat. 661, 668 (2004)
(emphasis added). Even if congressional findings could overrule decided
cases, Microsoft plainly did not so limit judicial discretion.
See Microsoft, 56 F.3d at 1462 (mentioning "mockery" only in
context of a challenge to the extensiveness of the government's case;
mentioning other bases for rejecting a proposed decree in other contexts).
The best reading of the amendments and the legislative history is that
they essentially codify existing case law. Cf. 150 Cong.
Rec. S3610, at S3613 (daily ed. Apr. 2, 2004) (statement of Sen. Hatch)
(noting that "this amendment essentially codifies existing case law").
Indeed, the propositions for which the United States's Competitive Impact
Statement cited Microsoft are quite consistent with the language
added by Congress in the 2004 amendments to the Tunney Act. CompareUnited States v. SBC Communications, Inc., Civ. Action No:
1:05CV02102(EGS), Competitive Impact Statement (Doc. 7) at 15-18 (D.D.C.
filed Nov. 16, 2005) andUnited States v. Verizon Communications
Inc., Civ. Action No: 1:05CV02103(EGS), Competitive Impact Statement
(Doc. 5) at 15-18 (D.D.C. filed Nov. 16, 2005) with COMPTEL
Motion and Memorandum at 8.

4. COMPTEL raises several concerns about the adequacy
of the amended proposed Final Judgments, mirroring the comments they
submitted to the United States. See COMPTEL Motion passim.
Those issues have no bearing on the Motion and will be addressed in
detail by the United States in its Response to Comments.

5. In addition, COMPTEL's Motion suggests no basis
for intervention of right.

6. Although the Court of Appeals has read this
aspect of Rule 24(b) broadly to allow permissive intervention "if there
is a sound reason to allow it," Nat'l Children's Ctr., 146
F.3d at 1046 (quoting Textile Workers Union v. Allendale Co.,
226 F.2d 765, 768 (D.C. Cir. 1955) and also citing Nuesse v. Camp,
385 F.2d 694, 704 (D.C. Cir. 1967)), there are no sound reasons to stretch
Rule 24's language in Tunney Act cases. None of the cases that COMPTEL
cites, see COMPTEL Motion at 12, is a Tunney Act case or involves
procedures rich in opportunities for participation without intervention.
See Nat'l Children's Ctr., 146 F.3d at 1043 (granting intervention
to seek access to information under seal or covered by a protective
order); Nuesse, 385 F.2d at 699-701 (granting intervention
as of rightto state official responsible for enforcing state
law implicated by federal agency's action); Textile Workers Union,
226 F.2d at 768 (granting intervention to movant who cannot be compensated
for losses as a result of resolution of case in the interim while it
seeks its own relief outside the instant case).

7. If a concern about the adequacy of a consent
decree were sufficient to meet the "claim or defense" requirement, there
would be effectively no limits on permissive intervention in a Tunney
Act proceeding and ANY commenter could qualify for permissive intervention.

8. Cf. Crosby Steam Gage & Valve Co. v.
Manning, Maxwell & Moore, Inc., 51 F. Supp. 972, 973 (D.
Mass. 1943) ("Additional parties always take additional time.
Even if they have no witnesses of their own, they are the source of
additional questions, objections, briefs, arguments, motions and the
like which tend to make the proceeding a Donnybrook Fair.").

9. See United States v. Microsoft Corp.,
No. 98-1232(CKK), Mem. Op. and Order, at 4 (D.D.C. Mar. 4, 2002) (attached
to COMPTEL Motion as Ex. F) (denying SBC's motion to intervene to provide
written submissions to the Court, respond to submissions of the parties,
and present oral argument, but granting limited participation as amicus);
United States v. Microsoft Corp., No. 98-1232(CKK), Mem. Op.
and Order, at 4-5 (D.D.C. Mar. 4, 2002) (attached to COMPTEL Motion
as Ex. E) (denying similar CCIA motion to intervene).

11. See 15 U.S.C. § 16(e)(2)
("Nothing in this section shall be construed to require the court to
conduct an evidentiary hearing or to require the court to permit anyone
to intervene."); 150 Cong. Rec. S3610, at S3613 (daily ed. Apr. 2, 2004)
(statement of Sen. Hatch) (noting that "this amendment essentially codifies
existing case law"); id. at S3615 (statement of Sen. Leahy)
(noting that "the legislation makes clear that this amendment to the
Tunney Act will not change the law regarding whether a court may be
required . . . to permit intervention or to hold a hearing in a . .
. proceeding"); id. at S3618 (statement of Sen. Kohl) (noting
that "[o]ur amendments make no changes to" how to conduct Tunney Act
proceedings).

12. If the Court decides that it needs additional
information, the United States would appreciate the opportunity to understand
the Court's remaining questions or concerns, and offer its views on
the most efficient and effective way to address those, particularly
since some potential approaches ­ such as the third-party discovery
suggested by COMPTEL ­ would raise substantial complexities and
burdens. Indeed, the United States is unaware of any Tunney Act proceeding
where a third party was allowed to take discovery, much less the range
of discovery COMPTEL seeks which is more appropriate to a litigated,
rather than a settled, antitrust case. Cf. 119 Cong. Rec. 24,597,
24,598 (1973) (statement of Sen. Tunney) ("The court is nowhere
compelled to go to trial or to engage in extended proceedings which
might have the effect of vitiating the benefits of prompt and less costly
settlement through the consent decree process.").